DHS Awards $48M for Network Resilience Cybersecurity, Raising Value Concerns

Contract Overview

Contract Amount: $48,018,389 ($48.0M)

Contractor: Guidehouse LLP

Awarding Agency: Department of Homeland Security

Start Date: 2019-09-30

End Date: 2022-03-29

Contract Duration: 911 days

Daily Burn Rate: $52.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: NEW TASK ORDER FOR FEDERAL NETWORK RESILIENCE (FNR) CYBERSECURITY PROGRAM AND SERVICES SUPPORT

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $48.0 million to GUIDEHOUSE LLP for work described as: NEW TASK ORDER FOR FEDERAL NETWORK RESILIENCE (FNR) CYBERSECURITY PROGRAM AND SERVICES SUPPORT Key points: 1. Significant award of $48M for cybersecurity services. 2. Competition method is 'Full and Open', suggesting potential for competitive pricing. 3. Contract type is 'Time and Materials', which can lead to cost overruns. 4. Small business participation is not indicated. 5. Sector is IT services, a critical area for federal operations.

Value Assessment

Rating: questionable

The Time and Materials contract type for a $48M award warrants scrutiny. While it allows for flexibility, it lacks the cost control inherent in fixed-price contracts, potentially leading to higher-than-expected spending without clear performance metrics tied to cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is a positive sign for price discovery. However, the Time and Materials pricing structure may still allow costs to escalate beyond initial expectations, even with competitive bidding.

Taxpayer Impact: The use of Time and Materials for a large cybersecurity contract could result in taxpayers paying more than necessary if not closely managed and monitored for efficiency.

Public Impact

Federal network security is enhanced, protecting critical infrastructure. Taxpayer funds are allocated to a vital cybersecurity program. The contract supports the Department of Homeland Security's mission. Potential for cost overruns due to contract type impacts budget predictability.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type
Lack of small business participation
Potential for cost escalation

Positive Signals

Full and open competition
Supports critical cybersecurity mission

Sector Analysis

This contract falls within the IT services sector, specifically focusing on cybersecurity. Federal spending in this area has been steadily increasing due to evolving threats. Benchmarks for similar cybersecurity support contracts vary widely based on scope and complexity.

Small Business Impact

The data indicates that small businesses were not a direct participant in this contract award (ss: false, sb: false). Opportunities for small business subcontracting were not explicitly mentioned, which could be a missed opportunity for economic inclusion.

Oversight & Accountability

The Office of Procurement Operations awarded this delivery order. Oversight will be crucial to manage the Time and Materials aspect, ensuring efficient use of funds and adherence to program goals to prevent cost overruns.

Related Government Programs

Computer Systems Design Services
Department of Homeland Security Contracting
Office of Procurement Operations Programs

Risk Flags

Potential for cost overruns due to Time and Materials contract.
Lack of explicit small business participation.
Limited insight into specific service deliverables and performance metrics.
Cybersecurity threats are constantly evolving, requiring continuous adaptation and potentially increased costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $48.0 million to GUIDEHOUSE LLP. NEW TASK ORDER FOR FEDERAL NETWORK RESILIENCE (FNR) CYBERSECURITY PROGRAM AND SERVICES SUPPORT

Who is the contractor on this award?

The obligated recipient is GUIDEHOUSE LLP.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $48.0 million.

What is the period of performance?

Start: 2019-09-30. End: 2022-03-29.

What specific cybersecurity services are included under this task order, and how do they align with the FNR program's objectives?

The task order is for 'Federal Network Resilience (FNR) Cybersecurity Program and Services Support'. While the specific services aren't detailed here, they likely encompass a range of activities aimed at strengthening the resilience of federal networks against cyber threats. This could include threat detection, incident response, vulnerability management, and security architecture support, all crucial for maintaining the operational integrity of federal systems.

Given the Time and Materials contract type, what mechanisms are in place to control costs and ensure value for money?

Time and Materials contracts inherently carry a higher risk of cost escalation. Effective oversight requires robust monitoring of labor hours, rates, and material costs. Agencies typically implement cost ceilings, require detailed reporting, and conduct regular reviews to ensure the contractor's efforts are efficient and directly contribute to program objectives, thereby attempting to mitigate uncontrolled spending.

How does the $48M award compare to typical spending for similar cybersecurity support contracts within the federal government?

The $48M figure for a three-year period (Sept 2019 - Mar 2022) is substantial but not unusual for comprehensive cybersecurity support programs. However, the value proposition is heavily influenced by the Time and Materials structure. Comparing it requires detailed service scope analysis; a fixed-price contract for equivalent services might offer a clearer benchmark for cost-effectiveness.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 70RCSA19R00000006

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Pricewaterhousecoopers Public Sector LLP (UEI: 791716954)

Address: 1800 TYSONS BLVD FL 7, MCLEAN, VA, 22102

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $49,957,200

Exercised Options: $48,018,389

Current Obligation: $48,018,389

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200040W

IDV Type: GWAC

Timeline